A lot of personal finance advice starts out with “Everyone needs an emergency fund”. A survey showed that a third of middle-class families couldn’t pay an unexpected bill of £500 without borrowing, so the lack of savings is a very widespread problem. But what if you already have debts that you are paying off? Accumulating an emergency fund will delay clearing the debts … but having a rainy day … [Read more...]
Articles about "Snowballing" - how to clear debt fast
"Snowballing" is the name given to method of paying off your debts as fast as possible, by paying the minimum to all except one and overpaying that one by as much as possible every month. You will also end up with a great credit record!
To find how this works, how to choose which debt to make your top priority and ideas about how you can snowball most effectively, see Debt Camel's Guide to Snowballing.
This page is an archive of all articles about Snowballing in date order.
Credit cards – to close or not to close?
If you have a credit card with a zero balance, should you close it? Would cancelling it improve or harm your credit score? This is important to get right if you are trying to clear your debts as fast as possible or if you are hoping to get a mortgage soon. It also applies to catalogue accounts. Here are the main arguments for and against closing the credit card: Four reasons to … [Read more...]
Credit cards – the minimum payment trap
Do you only make the minimum payments on your credit cards? If money is tight, you may feel minimum payments are your only option, but do you know how much they are costing you and how long it will take to pay it all off? And do you know that there is a simple alternative that will speed up debt repayments a lot and not cost you any more? Read on! How long does it take to clear the … [Read more...]
Not so many 0% balance transfer deals in 2019 & they are shorter
For two years the 0% balance transfers on offer have been getting slowly less good. Here is how they have been falling over the past two years: back in May 2017, you could have got a 43 month deal in May 2018 there were 37 month deals on offer in February 2019 the longest offer was 32 months in March 2019 that had dropped to 29 months in June 2019 29 months is still the longest … [Read more...]
Too much debt – shall I stop paying into a pension?
If you are paying high interest on credit cards or other debts should you use every penny possible to reduce your debts? You certainly shouldn't have a lot of savings whilst you are in debt, but there are many good reasons why you should continue to make pension contributions. Nearly 10 million people have started saving money into their pension since auto-enrollment came in, where employers … [Read more...]
“What’s the best way to clear credit card debt?”
A reader has a very common situation: I have £12,000 of debt on a couple of credit cards and a catalogue. Is a loan the best way to sort this out as soon as possible? It's not possible to answer that without a lot more details... but let's explore the options and see what makes some ways better for some people. Why do you want to do this? There are three main reasons: you are fed up with … [Read more...]
Game, set and match – how to ace your debts!
Paying off debt can feel like a long war with your creditors - you may have a good few months and then some setbacks. But what if this battle was a game of tennis? Listening to the Wimbledon commentators gives clues about how the top players approach training and big matches ... Here are five ideas that can also be applied to clearing debt. 1) Improve your skills "She's been working … [Read more...]
Buying too much online? 5 ways to cut back
A few taps on your mobile and that handbag, those kids' clothes or this kitchen gadget is on its way to you. This can be very convenient with busy lives and little time to go to the shops. But when money is tight or you want to save for something important, is it just too easy to overspend? If it's difficult to resist temptation and you want to cut back a bit - or a lot - to stop wasting … [Read more...]
How banks make money from 0% balance transfer deals
Although the 0% balance transfers on offer are less good at the end of 2018 than they were a year ago, there are still some great deals to be had. So good that you may be wondering what the catch is! Banks do expect to make money from these "bargain offers". If you know how, you can plan to avoid this and make sure you are the one that gets the bargain, not the credit card company. How do … [Read more...]
Which debt should I clear first?
If you are determined to pay off your debts, then you may have heard of "snowballing" - it's the approach where you pay the minimum to all of your debts except one, which you overpay by as much as possible each month. (If you can't afford to pay the minimums to your debts, snowballing isn't for you - look at A simple roadmap of debt solutions to see what your options are.) But which debt should … [Read more...]